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IR PRESENTATION




Key strategic priorities for 2011-2015,
financial results for 2010 & 1H 2011 (IFRS)
8th Annual Emerging European Investment Conference
London, September 7-8 2011
Disclaimer

    The information in this presentation was received from the sources, which in opinion of IDGC of Centre (“the Company”)
    are reliable. Nevertheless, we do not guarantee the accuracy of the given information, which may be short or incomplete.
    All opinions and estimations contained in the present material reflect our opinion at the date of publication, and are
    subject to the change without any notice.

    This presentation does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer
    to purchase or subscribe for, any shares or other securities representing shares in the Company, nor shall it or any part
    of it nor the fact of its presentation or distribution form the basis of, or be relied on in connection with any contract or
    investment decision.

    The information in this presentation includes forward-looking statements. These forward-looking statements include all
    matters that are not historical facts, statements regarding the Company’s intentions, beliefs or current expectations
    concerning,       among        other     things,      the     Company’s         results     of     operations,     financial
    condition, liquidity, prospects, growth, strategies, and the industry in which the Company operates. By their
    nature, forward-looking statements involve risks and uncertainties, including, without limitation, the risks and
    uncertainties to be set forth in the prospectus, because they relate to events and depend on circumstances that may or
    may not occur in the future. The Company cautions you that forward looking statements are not guarantees of future
    performance and that its actual results of operations, financial condition and liquidity and the development of the industry
    in which the Company operates may differ materially from those made in or suggested by the forward-looking statements
    contained in this presentation. In addition, even if the Company’s results of operations, financial condition and liquidity
    and the development of the industry in which the Company operates are consistent with the forward-looking statements
    contained in this presentation, those results or developments may not be indicative of results or developments in future
    periods

    The Company does not bear the responsibility for consequences of use of opinions containing in the present report or
    applications, or for incompleteness of the information. No person is under any obligation to update or keep current the
    information contained herein.

    By attending the presentation you agree to be bound by the foregoing limitations.




2
I.


    Key strategic priorities for 2011-2015


    Chief Executive Officer – Dmitry Gudzhoyan




3
Introduction

                               Service area–
                                                                         10                                                                              2010
                                 458 000                     8
                                   km2                                        11
    IDGC of Center                                   2                                 4                 MCap, RUR billion                                36
                                15% of the                                                               as at September 02, 2011
    1     Belgorodenergo          Russian
    2     Bryanskenergo         population                                                               Revenue (IFRS)                                    61
                                                                                                         RUR billion
    3     Voronezhenergo
                                                                                                         Length of lines,                                365
    4     Kostromaenergo                                                           Yaroslavl             km thousand*
                                               Smolensk              Tver
    5     Kurskenergo                                                                                    Substation capacity,
                                                                                                         MWA
    6     Lipetskenergo                        Bryansk            IDGC of Centre       Kostroma                                                     31 404
                                                                                                         35-110 kV
                                             Kursk               Orel
    7     Orelenergo                                                     Lipetsk
                                                                                                         6-10/0.4 kV                                15 192
                                             Belgorod
    8     Smolenskenergo
                                                                          Tambov
                                                     Voronezh
    9     Tambovenergo                                                                                   Staff number                             30 906
    10    Tverenergo
    11    Yarenergo                5     7                                                               Number of                                  16 775
                                                                                               9         shareholders**
                                                                     6
    The Company is a monopolist –
    tariffs are regulated by the State
                                                         1
                                                                 3
                                                                                                   *- overhead power lines 0.4-110 kV
                                                                                                   ** - as at 12.05.2011 – the date of registry closed



4
Story line 2010-2011


                  09.2010              11.2010               12.2010              01.2011                 06.2011           08.2011



12.2004 –
2009



             Board of directors approved        5 years RAB tariff system       Successful                 The AGSM approved USD 20.1
             the Regulations                    had been adopted in             implementation of the      million (RUR 611 million) of
             on the dividend policy             Orelenergo and                  business plan and the      dividend payment (the pay-out
             based on a system                  Bryanskenergo                   investment program for     ratio – 12.6%).
             executing a set of criteria        iRAB amounts USD 3.9 billion    2010, the actual volume    The Company fulfilled its
                                                (RUR 118 bln)                   of CAPEX amounted to       obligations to pay dividends
December’04                                                                     103% of the plan –USD      on 17.08.2011
As part of RAO UES reforming                                                    401 million (RUR 12
IDGC of Centre and North                                                        billion)
Caucasus had been registered for                                                                                          Company stocks moved across
RGC integration                                                                                                           to MICEX quotation list А2.
April ‘07                            The first stage of   The company acquired             5 years RAB tariff             Company confirmed 7+ rating
The final structure of the Company   Smart Grid           100% of Yargorelectroset ,       system adopted in              of corporate governance (on
had been accepted, including         program is           the share of IDGC of             Kostromaenergo,                the national scale) the highest
11 regional grid companies           completed in         Centre in regional grid          Tambovenergo,                  among all IDGCs.
of central Russia (the decision of
The board of directors of RAO        Belgorod             assets increased to              Voronezhenergo,                Company reported 1H2011
UES)                                                      90%                              Smolenskenergo                 IFRS financials,
                                                                                           and Yargorelectroset           demonstrating material
March ‘08 Affiliation of RGCs                                                                                             growth throughout
May ‘08 Listing on MICEX and RTS                                                                                          the reporting period across
                                                                                                                          key financial indicators


5
Strategic goals
                                 •    Consolidation of TGCs and abandoned power grids in
    Consolidation of                  regions
    power grid assets            •    Management of inefficient owners’ power grids
                                 •    Settlement of the "last mile" and the tariff rates growth in
                        1             the regions of TGCs
                                 •    Reliable sources of technical and commercial losses
                                      calculation system established
    Improvement of
    quality and reliability      •    Replacement of lines and transformers on the basis of
    of customer services              economic expediency
                                 •    Implementation of the innovative projects (smart
                        2             grid, smart metering)
                                 •    Increasing of the reliability indicators (SAIDI, SAIFI)
    Improving the
    efficiency of operating      •    Working in accordance with the RAB methodology
    activities                   •    Assets management program (unified technical policy)
                                 •    Improving the procurement process
                        3        •    Optimization of the management structure


                                 Improvement of the Company’s equity story
                         •    Shareholder value growth through meeting strategic goals 1-3;
                                   • Share liquidity program implementation;
                                      • Possible privatization in 2013-2014
6
Company structure and key shareholders

    Russian Federation                                                                                                Share capital
                   53.69%                                                                                             structure, %

       IDGC Holding                                             Minor shareholdres                                     50.23                   15.90
                   50.23%                                                             49.77%*                            %                       %


Group of companies
                                                                                                                               Free float
                                 IDGC of Center, JSC                                                                             30%                  8.40%
                                                                                                                                                  3.20%
                                        Subsidiaries – 100%                                                                                    2.73%
                                                                                                                               18.09          1.45%
                                                                                                                                 % Others

                                                     Yargorelectroset,                 Energy service
                      Energetik, JSC                                                                                       ОАО «Холдинг МРСК»
                                                                                                                            IDGC Holding, JSC
                                                           JSC                         company, JSC
                                                                                                                           Jamica Limited
                                                                                                                             Jamica Limited
                                                     Yargoreletroset, JSC is the      The main activities are
                     51%                             largest     Territory   Grid     providing saving energy
                                                     Organization in the Central      services , energy                   THE BANKof New York Mellon
                                                                                                                            The Bank OF NEW YORK
                                                                                                                          MELLON
    11 operating        YarESK, JSC                  Federal Region. The result of
                                                     acquisition of the 100%
                                                                                      efficiency
                                                                                                                          IMMENSO Enterprises Limited
                                                                                                                            Immenso ENTERPRISES
      business                                       stake is that IDGC of Center                                         LIMITED
                                                     now controls more than 90%
        units        -November                       of power grid assets in the
                                                                                                                            Energosoyuz Holdings Limited
                                                                                                                          ЭНЕРГОСОЮЗ
                                                                                                                          ХОЛДИНГС ЛИМИТЕД
                     11, 2009                        Yaroslavl region
                                                                                                                            Rusenergo Fund Limited
                     Energetik, JSC acquired
                     the controlling stake of
                     YarESK, JSC, which is
                     target     company        for
                     consolidation of power grid
                     assets in Yaroslavl region

                                                                                * - including the State share 0.46%


7
Share capital structure and
                                                                                             corporate governance
                                                                                          Supreme governing body:


                                                                                             General Meeting of
                                                                  Auditor                      Shareholders
    Developed corporate
                                                                                          Strategic
    governance                                                   Audit
                                                                                          governing body:
    practice, leading posit                                    Commission
    ion                                                    Outer control for financial
                                                                                                Board of Directors     5 Committees:

    among IDGCs -                                          activities of the Company



                                                                                                                              Committee
                                                                                              Management board                on Strategy

                                                                                                 Chairman of the              Committee
                                                                                                Management Board–
      History of IDGC of Center corporate                                                                                      on Audit
                                                                                                 General Director
      rating on the national scale
                                                                                                                             Committee
                                                                                                                            on personnel
                              NRCG**
      Confirmed (7+)                                August’ 11
                                                                                             Internal Control and             Committee
      Upgraded (7+)                               January ’ 11
                                                                                              Audit Department               on reliability
      Confirmed                                        July’ 09
      Confirmed                                    February’ 09
                                                                                                                              Committee
      Assigned                                   September’ 08                           Inner control for financial
                                                                                                                                on TC*
                                                                                         activities of the Company

    ** National rating of corporate governance                                                                         * - technological connection

8
M&A projects - grid assets integration

                                                                 TGCs in IDGC of Centre service area
                                                                                             Amount of other TGCs = 441
                                                           120
    •   The other TGCs’ average share in revenue                                                                                                                 102
        in IDGC of Centre service areas – 20%;             100

                                                           80                                                                                        70
    •   Required Gross Revenue (RGR) of the                                                                                               62
                                                           60                                                                   53
        Company due to the assets consolidation                                                                      39
        in regions may increase to RUR 10 billion          40
                                                                                   25 26
        by 2015, RGR share may grow by 97%;                               14 18 23
                                                           20     9
                                                            0
    •   One of the key goals of the Company is the




                                                                                                                     Belgorod




                                                                                                                                                                 Voronezh
                                                                                                                                Bryansk
                                                                 Tambov




                                                                                                                                          Smolensk
                                                                          Kursk




                                                                                                    Tver

                                                                                                           Lipetsk
                                                                                  Kostroma

                                                                                             Orel




                                                                                                                                                     Yaroslavl
        integration of power grid assets that will
        allow:
    •   increasing the reliability level of power supply
    •   enlarging the power distribution sales market       Share of the Company in the power
    •   improving the quality of customer service           transmission market, 2007-2015F
    •   balancing the tariff on power distribution
                                                                                     2007           2008             2009                 2010                   2015F
                                                            Market
                                                            share in
                                                                                      83%           83.6%            83.8%                   84%                     97%
                                                            terms of
                                                            money



9
Integration key steps


                        • Providing monopoly on power grid services market in the regions of
                          presence with more than 97% share;
     Target/            • Long-term target program for the consolidation of power grid assets have
     Program
                          been developed and approved (power grid assets consolidation plan for
                          2011 - 2015)

                        • Company consolidates the assets primarily in 3 ways: acquisition of
                          power grid, long term property rent, purchase of shares of power grid
     Methods and          companies;
     advantages         • The basic advantages of consolidation are as follows: implementation
     of consolidation     of a unified technical policy, the development of a unified scheme
                          of long-term development of power grids, improving the reliability
                          of electricity supply to consumers of all categories, increasing of
                          power grid capacity

                        • It is planned in 2011 to consolidate municipal power grid assets of the
     Plans for            Voronezh region, to acquire the property in the Lipetsk region and to
     2011-2015            consolidate the assets in the Tver region;
                        • Program provides working with more than 5 thousand owners



10
Dynamics of losses


                        Output                 Change,                    Dynamics of losses,
 Year                                 %                                     2006-2011 (F)
                     kW (thousand)               p.p.
                                                           12%
2006                          6 238    10.35                     10.35%                   10.11%
                                                                          9.52%                    10.01% 9.93%
                                                           10%                    9.40%
2007                          5 932     9.52      (0.83)
                                                           8%
2008                          5 875     9.40      (0.12)
                                                           6%

2009                          5 977    10.11        0.71   4%

2010                          6 230   10.01       (0.10)   2%

                                                           0%
2011F                         6 237    9.93       (0.08)
                                                                 2006     2007    2008    2009 2010П 2011F
                                                                                                2010 2011П




 Reduction of losses – the priority target for
  the management                                            Increase of losses was a result of
                                                             implementation of integration
 Implementation of renovation program and modern          program, introduction of common
  metering systems will allow IDGC to reduce losses by       technical requirements for all
  1% by 2015                                                subsidiaries will allow to reduce
                                                                          losses!


11
Expected CAPEX for 2011-2015
                                                                                       amounts to RUR 102 billion*

                                                                                        Uses of CAPEX in 2011
                                                                                                                                          10.7% 100%
                          Development,                           Commissioning,
  Year                                                                                                                                       1.6
                          RUR billion                              RUR billion                                                    1.0%
                                                                                                                     4.0 %
                                                                                                                6.0%   0.6        0.15
     2011F                       14.95                                    15.68
                                 17.58                                    18.84                                   0.9
     2012F                                                                                              7.4%
     2013F                       20.82                                   20.82                            1.1
                                                                                                32.8%                                               14.95
     2014F                       23.92                                   23.93
     2015F                       24.57                                    24.15
                                                                                                 4.9
                                                                                        38.1%
 Sources of finance in 2011
                                                                                         5.7
                  1,1%          0,1%                       Borrowed sources                     RUR billion

                                                           Tariff sources                 - Replacement of the main power equipment
                                                                                          - New construction(substations, overhead и cable lines)
                       49,7%
                  49,1%                                    Payments for connection        - ASMD systems, connection, IT
                                                           services                       - Developing/Modernization of accounting systems
                                                           Others                         - Modernization and reconstruction
                                                                                          - Acquisition of power grid systems
                                                                                          - Others
 * - in accordance with the adjusted IP, planned for approval in September, 2011


12
The development of energy-saving
                                                  technologies –Energy Service Company, JSC

          The Program of the RF Government -“Energy-saving and enhancement of power efficiency for the period up to 2020”




                                                                            Share in the authorized
                                                                                      capital -100%

                                                   Energy Service Company, JSC

     Key goals of establishment                                                                                        Key tasks

                 Diversification of the Company’s                             Conducting energy audits, evaluation and
      1           operations, strengthening its market                          reduction of energy losses of consumers;
                  positions, increase of revenues;                             Implementation of service and maintenance
                 Formation of the competence center for the                    functions to ensure stable and reliable
                  implementation of measures for energy-                        operation of power facilities;
                  saving and power efficiency based on                         Work on the analysis of new projects and
                  Energy Service Company (design and
      2           construction of facilities using energy-
                                                                                existing utility systems and equipment
                                                                                (expert review);
                  efficient technologies);
                                                                               Development of design and estimate
                 Formation of the resource base of highly                      documentation and its coordination
                  qualified personnel and technology for                        (examination) in the supervisory bodies;
      3           implementation of the repair program and
                                                                               The activities within energy service
                  the program of energy-saving and power
                  efficiency of IDGC of Centre.                                 contracts.




13
Attractive target for investments

                      • Transition to RAB is a vigorous driver for increase in operational
                        efficiency and decrease in costs per unit
     RAB regulation   • The first IDGC among others which transferred all its branches to RAB:
                         2009: 3 branches, 2010: 4 branches, since 01.01.2011: 4 branches
                      • High level of RAB - USD 4.0 billion (RUR 121 billion as at
                        01.01.2011)
                      • Capital formation rate is lower than profitability rate of invested capital
                      • Developed and implemented KPI system
     Strong team      • Strong financial performance - positive dynamics on all key financial
     of managers        and operating indicators for 4 years
                      • Transparent system of corporate management (7+ corporate governance
                        rating on national scale)


                      • Investment history of distribution grid complex attracts
                        high attention of analysts and investors:
     Prospects
     of growth           - on 21.06.2011 Annual General Meeting of Shareholders approved
                         dividend payments for 2010 in amount of USD 20.05 million
                         (RUR 610 million)
                         - sector is significantly undervalued as compared to foreign
                         peers
14
II.


     Financial results for 2010 & 1H2011 (IFRS)


     Chief Financial Officer - Konstantin Orlov




15
Key IFRS financial indicators
                                                                                                  2008 - 2011

 Key indicators 2008-2010 and 1H2011 (IFRS)

 RUR billion                              2008           2009          2010       CAGR                   1H2010          1H2011       Growth, %
 Revenue                                  43.7           49.3          60.6       17.8%                    29.5            35.2           19.2%
 Revenue growth                                         12.8%         22.9%                                28.6            33.6           17.6%

 EBITDA                                    8.8            8.6          12.4       18.7%                     5.7             8.6          49.9%

 EBITDA margin                            20.2%          17.4%        20.5%                               19.3%           24.3%           5 p.p.
 Net Income                                2.8            2.1           5.1       35.0%                     2.3             3.8          63.7%
 Net margin                               6.4%           4.3%          8.4%                                7.9%           10.9%           3 p.p.
 Net Debt                                  9.3           10.8          14.7       25.6%                    14.7            11.4          -22.4%

 Net Debt/EBITDA                           1.1            1.3           1.2        5.8%
                                                                                                                             Sources: Company’s data
  Sources: Company’s data, KPMG auditor

 Key operating drivers in 1H2011:
                                          •The control for final commercial and procurement procedures
                                            •The economy on procurement for 1H2011 amounts about RUR 1.9 billion
                                                          (about 14% of all procurement procedures)

                                                                   • Staff optimization
                                                  •The number of employees reduced by 148 in 1H2011

                                      •The conclusion of the single contract between FGC UES and IDGC of Centre
• In April 2011 the working group between UES FGC and IDGC of Centre was created – the single contract on providing the services has been concluded. The
principle advantage is that the payment for the services provided is based on balanced capacity. The estimated economical effect is about RUR 1.4 billion per
                                                                  year of reducing the tariff

16
Loan portfolio structure & credit rating

     Net debt/EBITDA, RUR billion                                      Credit rating history

     40                                                         22
                                                         1.94
     35
     30                                                          1.5
                                                                1,5
                           1.25       1.18               23.2
     25                                           21.9
            1.06
     20                                                         11
                                    14.7 14.9
     15                 10.8 11.1
          9.3 9.4
     10                                                         0,5
                                                                 0.5        History of IDGC of Centre credit rating
      5
     0                                                          0                           Standard&Poor’s
           2008            2009        2010         2011П
                                                    2011F                   Confirmed                          February’11
          Net debt долг
           Чистый                  Долг
                             Loan portfolio        net Debt/EBITDA          Confirmed                              July ’10
                                                                            Assigned                           November‘09
 Recommended                                                                                      NRА*
 ratio Net Debt/EBITDA = 3                                                  Upgraded to АА-                   December ‘10
                                                                            Confirmed                             October’10
                    Structure of loan portfolio (%),
                                  2011                                      Confirmed                          September’09
                                                                            Upgraded (level A+)                September’08
                      7%
                                              Sberbank                      Upgraded (level А)                    August‘07
               17%                            Rosbank
                             48%
                                              Alfabank
                  27%
                                              Gazprombank
                                                                       * National Rating Agency




17
Required Gross Revenue** structure and
                                                                    structure of operating expenditures 2011

      RUR billion
                                                                                                                                Required gross
                                                                               Non-controllable costs–                             revenue
       69.9                                                                       RUR 39.9 billion
                                                                                                                                 structure, %

                                                                                                                                                 4.6
                                                      53.9        14.2                                                                  4.6                   16.7
                                                                                                                                 5.3         10 11            1
                                                                                                                                       9
                                                                                                                          7.4
                2011                                                                                                              8
                                                                              11.5
                  Productive
                  supply,                                                                                                                                             2 13.4
                                                                                                                         7.5
                  billion kWh
                                         53.7                     FGC
                                                                services
                                                                                                                                 7
                                                                                       8.6                                        6
                                                                                                                           7.9                                    3
                  Average                                                    TGO                                                             5         4              11.9
                                      1 295.6                              services               5.6
                  tariff,
                                                                                                                                       9.5
                  RUR/MWh                                                              Losses               14                                         11.2
                                                                                      purchase
                                                                                                 Others
                                                                                                                                Belgorod (1)               Lipetsk (2)
                  Tariff             16.5%
                  growth                                                                                                        Voronezh (3)               Tver (4)
                                                                                                                                Yaroslavl (5)              Kursk (6)

    Revenue                                          OPEX                                                 Controllable          Bryansk (7)                Smolensk (8)
  incl. TGCs*                                                                                              costs ***            Kostroma (9)               Tambov (10)
* - RGR due to the Tariff Balanced Solutions as on 01.08.2011
** - exc. Yargorelectroset                                                                                                      Orel (11)
*** - Controllable costs within OPEX


 18
Stock performance and liquidity increase




      05.2008                     04.2009               09.2010
                                                         08.2010          2Q2011             3Q2011              4Q2011


     Company ‘s         Company’s                  Company’s       Confirmation of    Dividends payment    Launch of option
     shares were        shares were                shares were     presence in RTS EU USD 20.05 million    program
     listed on          included in the            included in     and RTS-2          (RUR 610 million),   DR program
     MICEX              index:                     RTS EU*                            MICEX A2
     (quotation list    MICEX PWR                                                     inclusion
     B), RTS




     Dividends for 2010:                                  Company’s priorities for the stock performance
                                                          improvement:
     Total (RUR million)                610.9             •   Stable dividend policy
                                                          •   Quotation list update (MICEX A1)
     Net profit share                   12.6%
                                                          •   Depositary receipts launching
                                                          •   Inclusion in international indexes
     Dividend yield                     1.37%

       - forecast       * - RTS energy utilities

19
Company’s shares and sector indexes dynamics
                                                                                                                                                                                                                                                                                Beginning of trading:
                           Stock market indicators,multipliers                                                                                                                                                                                                                       May 21, 2008
                                                                                                                                                                                                                                                                                    Quotation list:
                           TSR (2010)                                        66%                        Peer companies                                                      Company reports the good
                                                                                                                                                                            financials for 2009 and plans                                                                            «А2» MICEX
                           P/E                                               4,5                        6,6                             8,8*                                on all the branches to adopt                                                               Shares of IDGC of Centre are part of the
                                                                                                                                                                            RAB after Jul 01, 2010                                                                           calculation base in indices:
     70%
                           EV/                                               3,2                        3,2                             5,1*                                                                                                                                        - MICEX PWR
     60%                   EBITDA                                                                                                                                                                                                                                                  - RTS-electricity
     50%                                                                                                                                                                                                                                                                               - RTS-2
     40%
                           EV/S                                              0,8                        0,6                             1,2*
     30%                   EV/RAB                                            0,44                       0,41                        1,29*                                                                                                                                                                     Feb 17. Head of
     20%                                                                                                                                                                                                                                                                                                      Russian Government
                                                                                                                                                                                                                                                                                                              announced the need to
     10%                                                                                                                                                                                                                                                                                                      curb the growth rate of
      0%                                                                                                                                                                                                                                                                                                      tariffs on power
     -10%
 -20%
 -30%                                                                                                                                                                                                    Remaining branches to adopt
                                                                                                                                                                                                         RAB (Nov’10, Jan’ 11)                                                                                 Shares of the
 -40%                                                                                                                                                                                                                                                                                                          Company have been
 -50%                                                                                                                                                                                                                                                                                                          included into MICEX
                                                                                                                                The information that government                                                                                                                                                A2 quotation list
 -60%
                                                                                                                                intends to adopt RAB                                                                                                                                                           Company reports
     -70%                                                                                                                                                                                                                                                                                                      good IFRS financials
 -80%                                                                                                                                                                                                                                                                                                          on 1H2011
 -90%




                                                                                                                                                                                                                                                      Февраль 2011
                                                                                                                                            Декабрь 2009
                                              Декабрь 2008




                                                                                                                                                                             April 2010
                             Октябрь 2008




                                                                                                                                                                                                       Август 2010
                                                              Февраль 2009




                                                                                                                         Октябрь 2009




                                                                                                                                                                                          June 2010
             Август 2008




                                                                                                                                                                                                                                                                      April 2011
                                                                               April 2009




                                                                                                                                                             Февраль 2010
                                                                                                           Август 2009




                                                                                                                                                                                                                                      Декабрь 2010




                                                                                                                                                                                                                                                                                   June 2011

                                                                                                                                                                                                                                                                                                Август 2011
                                                                                                                                                                                                                     Октябрь 2010
                                                                                            Июнь 2009
                                                                              Апрель2009




                                                                                                                                                                            Апрель2010
                             October 2008
            August 2008




                                                                                                                         October 2009




                                                                                                                                                                                                      August 2010

                                                                                                                                                                                                                     October 2010

                                                                                                                                                                                                                                    December 2010
                                                                                                                                                                                          Июнь2010
                                                                                                                                                            February 2010




                                                                                                                                                                                                                                                     February 2011

                                                                                                                                                                                                                                                                     Апрель2011

                                                                                                                                                                                                                                                                                   Июнь2011

                                                                                                                                                                                                                                                                                               August 2011
                                            December 2008

                                                             February 2009




                                                                                                          August 2009




                                                                                                                                          December 2009
                                                                                            June 2009




                                                                              MICEX PWR                                                                    MRKC of Centre                                                           MICEX
                                                                                                                                                                                                                                                                           * - Average international peer companies

20
THANK YOU
                      FOR YOUR ATTENTION!

     IR specialists will provide you with any additional information upon your request:

     ir@mrsk-1.ru


     IDGC of Center

     4/2, Glukharev Lane, Moscow, Russia 129090
     T: +7 495 747 9292 F: +7 495 747 9292
     www.mrsk-1.ru

     Tickers:
     MICEX:      MRKC
     RTS:        MRKC, MRKCG




21
APPENDIX




22
RAB adoption. Results

       Date of    Subsidiaries        Total value       IRAB,
     transition                       of invested     RUR million
                                                                                    Full value of IC and iRAB
                                        capital                              400
                                          RUR
                                        million                              350

                   Belgorodenergo            50 609           19 930
                                                                             300
                                                                                                115
from 01.01.2009      Lipetskenergo                                           250
                                             25 726           10 030
                        Tverenergo           55 276           14 366         200

                      Kurskenergo            30 782           10 802         150
from 01.01.2010
                         Yarenergo           21 586               8 968      100               226
                                                                                                                              42
                    Bryanskenergo
                                             20 045               5 989       50
from 01.11.2010                                                                                                               76
                        Orelenergo                                              0
                                             21 571               6 407
                                                                                      Полная величина ИК
                                                                                           Full value of         Остаточная величина ИК
                                                                                                                        Value of «new»
                  Kostromaenergo                                                         invested capital
                                                                                             (ПИК)                      invested capital
                                                                                                                          (ОИК)
                                             17 058               7 603                                                     IRAB
                                                                                                                            (IRAB)

                    Tambovenergo             18 609                5 515
                                                                                    Филиалы перешедшие01.01.2011
                                                                                     RAB subsidiaries after на RAB после 01.01.2011
from 01.01.2011    Voronezhenergo                                                    RAB subsidiaries before 01.01.2011
                                                                                    Филиалы перешедшие на RAB до 01.01.2011
                                             38 110           12 650

                   Smolenskenergo
                                             37 041               13 735             Approved iRAB on subsidiaries –
                  Yargorelectroset*                                                          USD 3.9 billion
                                              3 969               2 168
                                                                                            (RUR 118 billion)*
                             Total     340 382          118 162            *Including Yargorelectroset 100% stake is owned by IDGC of Center


23
Structure and dynamics of the tariff on
                                                                     power distribution

     Revenue dynamics by power distribution tariff
     2008-2010, RUR billion

                        70


                        60                                               57.56
                                                                  23%
                                                                          9.23
                        50                               46.87    37%                          Federal factors
                                              15%                                                 + 35%
                                 40.84                    6.76            11.01
                        40
                                 5.43
                                              25%                 40%
                                                          7.84
                                 6.38         23%                         9.44
                        30
                                                          8.01    18%
                                 6.63         21%                                              Regional factors
                        20                                                                         + 65%
                                                                  15%
                                              8%         24.25
                                                                         27.87
                        10       22.40


                        0
                                 2008
                                2008г.                    2009
                                                         2009г.           2010
                                                                         2010г.
                                    "Собственная" НВВ МРСК
                                     Required revenue             ТСО
                                                                   TGO   ФСК
                                                                          FGC     Потери э/э
                                                                                  Losses
                                     of IDGC of Centre




24
Decrease in RGR

     Decrease in RGR in accordance to Government Regulation №1172
     offset by lower costs in 2011
                 75,00

                 73,00                                -3.90
                                                                  -5.87
                 71,00

                                      74.02
                 69,00                                                     -2.73

                 67,00
                                                                                                68.15
                 65,00
                             Revenue 2011
                             Выручка 2011г. (ТБР   Decrease in OPEX
                                                     Сокращение                             Revenue 2011
                                                                       Decrease in CAPEX Выручка 2011г. (ТБР
                                                                        Сокращение
                             (TBS* 01.01.2011)
                                на 01.01.11)        операционных        капитальных      с учетом ПП №1172)
                                                                                            (TBS* taking into
                                                      расходов            расходов          account GR №1172)



                              Figures                  Revenue from services          OPEX              CAPEX

         2011
                                                               74.02                   68.77            17.68
         (TBS* 01.01.2011)
         2011
                                                               68.15                   64.87            14.95
         (TBS* taking into account GR №1172)
         Absolute CHNG                                         -5.87                   -3.90            -2.73
         *Tariff Balanced Solutions


25
Benchmark among IDGCs ‘11

                                 MCap, RUR billion                                   Revenue, RUR billion
                                   МОЭСК
                                  MOESK                         75                         МОЭСК
                                                                                           MOESK                        110,6
                           IDGC of Centre
                             МРСК Центра                                            IDGC of Центра
                                                                                     МРСК Centre              60,4
                                                    36
                                                         #2                                                           #2
             IDGCМРСК ЦентраVolga Region
                 of Centre and и Приволжья    19                     IDGC of Centre and и Приволжья
                                                                        МРСК Центра Volga Region              54,4
                                ЛенЭнерго
                                 Lenergo      17                                      IDGC ofУрала
                                                                                       МРСК Urals            49,8
                             IDGC of Урала
                              МРСК Urals      17                                    IDGC of Сибири
                                                                                     МРСК Siberia       43,4

                            IDGC ofСибири
                             МРСК Siberia    15                                        МРСК Волги
                                                                                     IDGC of Volga      39,4
                             IDGC of Волги
                              МРСК Volga     15                                           Lenergo
                                                                                        ЛенЭнерго     34,2

                       МРСК Северо-Запада
                        IDGC of North-West   11                                МРСК Северо-Запада
                                                                                IDGC of North-West    26,7
Company                      IDGC of South
                               МРСК Юга       5                                         МРСК Юга
                                                                                     IDGC of South    22,0
obtains leading     IDGC of North Caucasus
                   МРСК Северного Кавказа    3                              IDGC of North Caucasus
                                                                           МРСК Северного Кавказа     10,5
positions
among IDGCs                     Net profit, RUR billion                                RAB, RUR billion
                                  MOESK
                                   МОЭСК                 15,6                              MOESK
                                                                                           МОЭСК                      205,3
                                                                                    IDGC of Центра
                                                                                     МРСК Centre
                              МРСК Центра
                            IDGC of Centre    4,7        #2                                                   118,2
                                                                                                                         #2
                                 Lenergo
                                ЛенЭнерго    3,8                     IDGC of Centre and и Приволжья
                                                                        МРСК Центра Volga Region        84,8
                             IDGC of Урала
                              МРСК Urals      1,7                                       ЛенЭнерго      78,6
                                                                                          Lenergo
             IDGCМРСК Центра Volga Region
                 of Centre and и Приволжья    1,4                                      МРСК Волги      77,0
                                                                                     IDGC of Volga
                    IDGC of North Caucasus
                   МРСК Северного Кавказа    0,6                                     IDGC of Урала
                                                                                      МРСК Urals      57,2
                            IDGC of Volga
                              МРСК Волги     0,3                                    IDGC of Сибири
                                                                                     МРСК Siberia     51,6
                       МРСКof North-West
                       IDGC Северо-Запада    -0,8                               IDGC of North-West
                                                                               МРСК Северо-Запада     22,9

                            МРСК Сибири
                         IDGC of Siberia     -2,8                                       МРСК Юга
                                                                                     IDGC of South    22,5

26                       IDGC ofМРСК Юга
                                South        -3,6
                                                    2 позиция               IDGC of North Caucasus
                                                                           МРСК Северного Кавказа     18,0
                                                                                                              2 позиция

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Unicredit Emergin Europe Conference Sep 2011

  • 1. IR PRESENTATION Key strategic priorities for 2011-2015, financial results for 2010 & 1H 2011 (IFRS) 8th Annual Emerging European Investment Conference London, September 7-8 2011
  • 2. Disclaimer The information in this presentation was received from the sources, which in opinion of IDGC of Centre (“the Company”) are reliable. Nevertheless, we do not guarantee the accuracy of the given information, which may be short or incomplete. All opinions and estimations contained in the present material reflect our opinion at the date of publication, and are subject to the change without any notice. This presentation does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares or other securities representing shares in the Company, nor shall it or any part of it nor the fact of its presentation or distribution form the basis of, or be relied on in connection with any contract or investment decision. The information in this presentation includes forward-looking statements. These forward-looking statements include all matters that are not historical facts, statements regarding the Company’s intentions, beliefs or current expectations concerning, among other things, the Company’s results of operations, financial condition, liquidity, prospects, growth, strategies, and the industry in which the Company operates. By their nature, forward-looking statements involve risks and uncertainties, including, without limitation, the risks and uncertainties to be set forth in the prospectus, because they relate to events and depend on circumstances that may or may not occur in the future. The Company cautions you that forward looking statements are not guarantees of future performance and that its actual results of operations, financial condition and liquidity and the development of the industry in which the Company operates may differ materially from those made in or suggested by the forward-looking statements contained in this presentation. In addition, even if the Company’s results of operations, financial condition and liquidity and the development of the industry in which the Company operates are consistent with the forward-looking statements contained in this presentation, those results or developments may not be indicative of results or developments in future periods The Company does not bear the responsibility for consequences of use of opinions containing in the present report or applications, or for incompleteness of the information. No person is under any obligation to update or keep current the information contained herein. By attending the presentation you agree to be bound by the foregoing limitations. 2
  • 3. I. Key strategic priorities for 2011-2015 Chief Executive Officer – Dmitry Gudzhoyan 3
  • 4. Introduction Service area– 10 2010 458 000 8 km2 11 IDGC of Center 2 4 MCap, RUR billion 36 15% of the as at September 02, 2011 1 Belgorodenergo Russian 2 Bryanskenergo population Revenue (IFRS) 61 RUR billion 3 Voronezhenergo Length of lines, 365 4 Kostromaenergo Yaroslavl km thousand* Smolensk Tver 5 Kurskenergo Substation capacity, MWA 6 Lipetskenergo Bryansk IDGC of Centre Kostroma 31 404 35-110 kV Kursk Orel 7 Orelenergo Lipetsk 6-10/0.4 kV 15 192 Belgorod 8 Smolenskenergo Tambov Voronezh 9 Tambovenergo Staff number 30 906 10 Tverenergo 11 Yarenergo 5 7 Number of 16 775 9 shareholders** 6 The Company is a monopolist – tariffs are regulated by the State 1 3 *- overhead power lines 0.4-110 kV ** - as at 12.05.2011 – the date of registry closed 4
  • 5. Story line 2010-2011 09.2010 11.2010 12.2010 01.2011 06.2011 08.2011 12.2004 – 2009 Board of directors approved 5 years RAB tariff system Successful The AGSM approved USD 20.1 the Regulations had been adopted in implementation of the million (RUR 611 million) of on the dividend policy Orelenergo and business plan and the dividend payment (the pay-out based on a system Bryanskenergo investment program for ratio – 12.6%). executing a set of criteria iRAB amounts USD 3.9 billion 2010, the actual volume The Company fulfilled its (RUR 118 bln) of CAPEX amounted to obligations to pay dividends December’04 103% of the plan –USD on 17.08.2011 As part of RAO UES reforming 401 million (RUR 12 IDGC of Centre and North billion) Caucasus had been registered for Company stocks moved across RGC integration to MICEX quotation list А2. April ‘07 The first stage of The company acquired 5 years RAB tariff Company confirmed 7+ rating The final structure of the Company Smart Grid 100% of Yargorelectroset , system adopted in of corporate governance (on had been accepted, including program is the share of IDGC of Kostromaenergo, the national scale) the highest 11 regional grid companies completed in Centre in regional grid Tambovenergo, among all IDGCs. of central Russia (the decision of The board of directors of RAO Belgorod assets increased to Voronezhenergo, Company reported 1H2011 UES) 90% Smolenskenergo IFRS financials, and Yargorelectroset demonstrating material March ‘08 Affiliation of RGCs growth throughout May ‘08 Listing on MICEX and RTS the reporting period across key financial indicators 5
  • 6. Strategic goals • Consolidation of TGCs and abandoned power grids in Consolidation of regions power grid assets • Management of inefficient owners’ power grids • Settlement of the "last mile" and the tariff rates growth in 1 the regions of TGCs • Reliable sources of technical and commercial losses calculation system established Improvement of quality and reliability • Replacement of lines and transformers on the basis of of customer services economic expediency • Implementation of the innovative projects (smart 2 grid, smart metering) • Increasing of the reliability indicators (SAIDI, SAIFI) Improving the efficiency of operating • Working in accordance with the RAB methodology activities • Assets management program (unified technical policy) • Improving the procurement process 3 • Optimization of the management structure Improvement of the Company’s equity story • Shareholder value growth through meeting strategic goals 1-3; • Share liquidity program implementation; • Possible privatization in 2013-2014 6
  • 7. Company structure and key shareholders Russian Federation Share capital 53.69% structure, % IDGC Holding Minor shareholdres 50.23 15.90 50.23% 49.77%* % % Group of companies Free float IDGC of Center, JSC 30% 8.40% 3.20% Subsidiaries – 100% 2.73% 18.09 1.45% % Others Yargorelectroset, Energy service Energetik, JSC ОАО «Холдинг МРСК» IDGC Holding, JSC JSC company, JSC Jamica Limited Jamica Limited Yargoreletroset, JSC is the The main activities are 51% largest Territory Grid providing saving energy Organization in the Central services , energy THE BANKof New York Mellon The Bank OF NEW YORK MELLON 11 operating YarESK, JSC Federal Region. The result of acquisition of the 100% efficiency IMMENSO Enterprises Limited Immenso ENTERPRISES business stake is that IDGC of Center LIMITED now controls more than 90% units -November of power grid assets in the Energosoyuz Holdings Limited ЭНЕРГОСОЮЗ ХОЛДИНГС ЛИМИТЕД 11, 2009 Yaroslavl region Rusenergo Fund Limited Energetik, JSC acquired the controlling stake of YarESK, JSC, which is target company for consolidation of power grid assets in Yaroslavl region * - including the State share 0.46% 7
  • 8. Share capital structure and corporate governance Supreme governing body: General Meeting of Auditor Shareholders Developed corporate Strategic governance Audit governing body: practice, leading posit Commission ion Outer control for financial Board of Directors 5 Committees: among IDGCs - activities of the Company Committee Management board on Strategy Chairman of the Committee Management Board– History of IDGC of Center corporate on Audit General Director rating on the national scale Committee on personnel NRCG** Confirmed (7+) August’ 11 Internal Control and Committee Upgraded (7+) January ’ 11 Audit Department on reliability Confirmed July’ 09 Confirmed February’ 09 Committee Assigned September’ 08 Inner control for financial on TC* activities of the Company ** National rating of corporate governance * - technological connection 8
  • 9. M&A projects - grid assets integration TGCs in IDGC of Centre service area Amount of other TGCs = 441 120 • The other TGCs’ average share in revenue 102 in IDGC of Centre service areas – 20%; 100 80 70 • Required Gross Revenue (RGR) of the 62 60 53 Company due to the assets consolidation 39 in regions may increase to RUR 10 billion 40 25 26 by 2015, RGR share may grow by 97%; 14 18 23 20 9 0 • One of the key goals of the Company is the Belgorod Voronezh Bryansk Tambov Smolensk Kursk Tver Lipetsk Kostroma Orel Yaroslavl integration of power grid assets that will allow: • increasing the reliability level of power supply • enlarging the power distribution sales market Share of the Company in the power • improving the quality of customer service transmission market, 2007-2015F • balancing the tariff on power distribution 2007 2008 2009 2010 2015F Market share in 83% 83.6% 83.8% 84% 97% terms of money 9
  • 10. Integration key steps • Providing monopoly on power grid services market in the regions of presence with more than 97% share; Target/ • Long-term target program for the consolidation of power grid assets have Program been developed and approved (power grid assets consolidation plan for 2011 - 2015) • Company consolidates the assets primarily in 3 ways: acquisition of power grid, long term property rent, purchase of shares of power grid Methods and companies; advantages • The basic advantages of consolidation are as follows: implementation of consolidation of a unified technical policy, the development of a unified scheme of long-term development of power grids, improving the reliability of electricity supply to consumers of all categories, increasing of power grid capacity • It is planned in 2011 to consolidate municipal power grid assets of the Plans for Voronezh region, to acquire the property in the Lipetsk region and to 2011-2015 consolidate the assets in the Tver region; • Program provides working with more than 5 thousand owners 10
  • 11. Dynamics of losses Output Change, Dynamics of losses, Year % 2006-2011 (F) kW (thousand) p.p. 12% 2006 6 238 10.35 10.35% 10.11% 9.52% 10.01% 9.93% 10% 9.40% 2007 5 932 9.52 (0.83) 8% 2008 5 875 9.40 (0.12) 6% 2009 5 977 10.11 0.71 4% 2010 6 230 10.01 (0.10) 2% 0% 2011F 6 237 9.93 (0.08) 2006 2007 2008 2009 2010П 2011F 2010 2011П  Reduction of losses – the priority target for the management Increase of losses was a result of implementation of integration  Implementation of renovation program and modern program, introduction of common metering systems will allow IDGC to reduce losses by technical requirements for all 1% by 2015 subsidiaries will allow to reduce losses! 11
  • 12. Expected CAPEX for 2011-2015 amounts to RUR 102 billion* Uses of CAPEX in 2011 10.7% 100% Development, Commissioning, Year 1.6 RUR billion RUR billion 1.0% 4.0 % 6.0% 0.6 0.15 2011F 14.95 15.68 17.58 18.84 0.9 2012F 7.4% 2013F 20.82 20.82 1.1 32.8% 14.95 2014F 23.92 23.93 2015F 24.57 24.15 4.9 38.1% Sources of finance in 2011 5.7 1,1% 0,1% Borrowed sources RUR billion Tariff sources - Replacement of the main power equipment - New construction(substations, overhead и cable lines) 49,7% 49,1% Payments for connection - ASMD systems, connection, IT services - Developing/Modernization of accounting systems Others - Modernization and reconstruction - Acquisition of power grid systems - Others * - in accordance with the adjusted IP, planned for approval in September, 2011 12
  • 13. The development of energy-saving technologies –Energy Service Company, JSC The Program of the RF Government -“Energy-saving and enhancement of power efficiency for the period up to 2020” Share in the authorized capital -100% Energy Service Company, JSC Key goals of establishment Key tasks  Diversification of the Company’s  Conducting energy audits, evaluation and 1 operations, strengthening its market reduction of energy losses of consumers; positions, increase of revenues;  Implementation of service and maintenance  Formation of the competence center for the functions to ensure stable and reliable implementation of measures for energy- operation of power facilities; saving and power efficiency based on  Work on the analysis of new projects and Energy Service Company (design and 2 construction of facilities using energy- existing utility systems and equipment (expert review); efficient technologies);  Development of design and estimate  Formation of the resource base of highly documentation and its coordination qualified personnel and technology for (examination) in the supervisory bodies; 3 implementation of the repair program and  The activities within energy service the program of energy-saving and power efficiency of IDGC of Centre. contracts. 13
  • 14. Attractive target for investments • Transition to RAB is a vigorous driver for increase in operational efficiency and decrease in costs per unit RAB regulation • The first IDGC among others which transferred all its branches to RAB: 2009: 3 branches, 2010: 4 branches, since 01.01.2011: 4 branches • High level of RAB - USD 4.0 billion (RUR 121 billion as at 01.01.2011) • Capital formation rate is lower than profitability rate of invested capital • Developed and implemented KPI system Strong team • Strong financial performance - positive dynamics on all key financial of managers and operating indicators for 4 years • Transparent system of corporate management (7+ corporate governance rating on national scale) • Investment history of distribution grid complex attracts high attention of analysts and investors: Prospects of growth - on 21.06.2011 Annual General Meeting of Shareholders approved dividend payments for 2010 in amount of USD 20.05 million (RUR 610 million) - sector is significantly undervalued as compared to foreign peers 14
  • 15. II. Financial results for 2010 & 1H2011 (IFRS) Chief Financial Officer - Konstantin Orlov 15
  • 16. Key IFRS financial indicators 2008 - 2011 Key indicators 2008-2010 and 1H2011 (IFRS) RUR billion 2008 2009 2010 CAGR 1H2010 1H2011 Growth, % Revenue 43.7 49.3 60.6 17.8% 29.5 35.2 19.2% Revenue growth 12.8% 22.9% 28.6 33.6 17.6% EBITDA 8.8 8.6 12.4 18.7% 5.7 8.6 49.9% EBITDA margin 20.2% 17.4% 20.5% 19.3% 24.3% 5 p.p. Net Income 2.8 2.1 5.1 35.0% 2.3 3.8 63.7% Net margin 6.4% 4.3% 8.4% 7.9% 10.9% 3 p.p. Net Debt 9.3 10.8 14.7 25.6% 14.7 11.4 -22.4% Net Debt/EBITDA 1.1 1.3 1.2 5.8% Sources: Company’s data Sources: Company’s data, KPMG auditor Key operating drivers in 1H2011: •The control for final commercial and procurement procedures •The economy on procurement for 1H2011 amounts about RUR 1.9 billion (about 14% of all procurement procedures) • Staff optimization •The number of employees reduced by 148 in 1H2011 •The conclusion of the single contract between FGC UES and IDGC of Centre • In April 2011 the working group between UES FGC and IDGC of Centre was created – the single contract on providing the services has been concluded. The principle advantage is that the payment for the services provided is based on balanced capacity. The estimated economical effect is about RUR 1.4 billion per year of reducing the tariff 16
  • 17. Loan portfolio structure & credit rating Net debt/EBITDA, RUR billion Credit rating history 40 22 1.94 35 30 1.5 1,5 1.25 1.18 23.2 25 21.9 1.06 20 11 14.7 14.9 15 10.8 11.1 9.3 9.4 10 0,5 0.5 History of IDGC of Centre credit rating 5 0 0 Standard&Poor’s 2008 2009 2010 2011П 2011F Confirmed February’11 Net debt долг Чистый Долг Loan portfolio net Debt/EBITDA Confirmed July ’10 Assigned November‘09 Recommended NRА* ratio Net Debt/EBITDA = 3 Upgraded to АА- December ‘10 Confirmed October’10 Structure of loan portfolio (%), 2011 Confirmed September’09 Upgraded (level A+) September’08 7% Sberbank Upgraded (level А) August‘07 17% Rosbank 48% Alfabank 27% Gazprombank * National Rating Agency 17
  • 18. Required Gross Revenue** structure and structure of operating expenditures 2011 RUR billion Required gross Non-controllable costs– revenue 69.9 RUR 39.9 billion structure, % 4.6 53.9 14.2 4.6 16.7 5.3 10 11 1 9 7.4 2011 8 11.5 Productive supply, 2 13.4 7.5 billion kWh 53.7 FGC services 7 8.6 6 7.9 3 Average TGO 5 4 11.9 1 295.6 services 5.6 tariff, 9.5 RUR/MWh Losses 14 11.2 purchase Others Belgorod (1) Lipetsk (2) Tariff 16.5% growth Voronezh (3) Tver (4) Yaroslavl (5) Kursk (6) Revenue OPEX Controllable Bryansk (7) Smolensk (8) incl. TGCs* costs *** Kostroma (9) Tambov (10) * - RGR due to the Tariff Balanced Solutions as on 01.08.2011 ** - exc. Yargorelectroset Orel (11) *** - Controllable costs within OPEX 18
  • 19. Stock performance and liquidity increase 05.2008 04.2009 09.2010 08.2010 2Q2011 3Q2011 4Q2011 Company ‘s Company’s Company’s Confirmation of Dividends payment Launch of option shares were shares were shares were presence in RTS EU USD 20.05 million program listed on included in the included in and RTS-2 (RUR 610 million), DR program MICEX index: RTS EU* MICEX A2 (quotation list MICEX PWR inclusion B), RTS Dividends for 2010: Company’s priorities for the stock performance improvement: Total (RUR million) 610.9 • Stable dividend policy • Quotation list update (MICEX A1) Net profit share 12.6% • Depositary receipts launching • Inclusion in international indexes Dividend yield 1.37% - forecast * - RTS energy utilities 19
  • 20. Company’s shares and sector indexes dynamics Beginning of trading: Stock market indicators,multipliers May 21, 2008 Quotation list: TSR (2010) 66% Peer companies Company reports the good financials for 2009 and plans «А2» MICEX P/E 4,5 6,6 8,8* on all the branches to adopt Shares of IDGC of Centre are part of the RAB after Jul 01, 2010 calculation base in indices: 70% EV/ 3,2 3,2 5,1* - MICEX PWR 60% EBITDA - RTS-electricity 50% - RTS-2 40% EV/S 0,8 0,6 1,2* 30% EV/RAB 0,44 0,41 1,29* Feb 17. Head of 20% Russian Government announced the need to 10% curb the growth rate of 0% tariffs on power -10% -20% -30% Remaining branches to adopt RAB (Nov’10, Jan’ 11) Shares of the -40% Company have been -50% included into MICEX The information that government A2 quotation list -60% intends to adopt RAB Company reports -70% good IFRS financials -80% on 1H2011 -90% Февраль 2011 Декабрь 2009 Декабрь 2008 April 2010 Октябрь 2008 Август 2010 Февраль 2009 Октябрь 2009 June 2010 Август 2008 April 2011 April 2009 Февраль 2010 Август 2009 Декабрь 2010 June 2011 Август 2011 Октябрь 2010 Июнь 2009 Апрель2009 Апрель2010 October 2008 August 2008 October 2009 August 2010 October 2010 December 2010 Июнь2010 February 2010 February 2011 Апрель2011 Июнь2011 August 2011 December 2008 February 2009 August 2009 December 2009 June 2009 MICEX PWR MRKC of Centre MICEX * - Average international peer companies 20
  • 21. THANK YOU FOR YOUR ATTENTION! IR specialists will provide you with any additional information upon your request: ir@mrsk-1.ru IDGC of Center 4/2, Glukharev Lane, Moscow, Russia 129090 T: +7 495 747 9292 F: +7 495 747 9292 www.mrsk-1.ru Tickers: MICEX: MRKC RTS: MRKC, MRKCG 21
  • 23. RAB adoption. Results Date of Subsidiaries Total value IRAB, transition of invested RUR million Full value of IC and iRAB capital 400 RUR million 350 Belgorodenergo 50 609 19 930 300 115 from 01.01.2009 Lipetskenergo 250 25 726 10 030 Tverenergo 55 276 14 366 200 Kurskenergo 30 782 10 802 150 from 01.01.2010 Yarenergo 21 586 8 968 100 226 42 Bryanskenergo 20 045 5 989 50 from 01.11.2010 76 Orelenergo 0 21 571 6 407 Полная величина ИК Full value of Остаточная величина ИК Value of «new» Kostromaenergo invested capital (ПИК) invested capital (ОИК) 17 058 7 603 IRAB (IRAB) Tambovenergo 18 609 5 515 Филиалы перешедшие01.01.2011 RAB subsidiaries after на RAB после 01.01.2011 from 01.01.2011 Voronezhenergo RAB subsidiaries before 01.01.2011 Филиалы перешедшие на RAB до 01.01.2011 38 110 12 650 Smolenskenergo 37 041 13 735 Approved iRAB on subsidiaries – Yargorelectroset* USD 3.9 billion 3 969 2 168 (RUR 118 billion)* Total 340 382 118 162 *Including Yargorelectroset 100% stake is owned by IDGC of Center 23
  • 24. Structure and dynamics of the tariff on power distribution Revenue dynamics by power distribution tariff 2008-2010, RUR billion 70 60 57.56 23% 9.23 50 46.87 37% Federal factors 15% + 35% 40.84 6.76 11.01 40 5.43 25% 40% 7.84 6.38 23% 9.44 30 8.01 18% 6.63 21% Regional factors 20 + 65% 15% 8% 24.25 27.87 10 22.40 0 2008 2008г. 2009 2009г. 2010 2010г. "Собственная" НВВ МРСК Required revenue ТСО TGO ФСК FGC Потери э/э Losses of IDGC of Centre 24
  • 25. Decrease in RGR Decrease in RGR in accordance to Government Regulation №1172 offset by lower costs in 2011 75,00 73,00 -3.90 -5.87 71,00 74.02 69,00 -2.73 67,00 68.15 65,00 Revenue 2011 Выручка 2011г. (ТБР Decrease in OPEX Сокращение Revenue 2011 Decrease in CAPEX Выручка 2011г. (ТБР Сокращение (TBS* 01.01.2011) на 01.01.11) операционных капитальных с учетом ПП №1172) (TBS* taking into расходов расходов account GR №1172) Figures Revenue from services OPEX CAPEX 2011 74.02 68.77 17.68 (TBS* 01.01.2011) 2011 68.15 64.87 14.95 (TBS* taking into account GR №1172) Absolute CHNG -5.87 -3.90 -2.73 *Tariff Balanced Solutions 25
  • 26. Benchmark among IDGCs ‘11 MCap, RUR billion Revenue, RUR billion МОЭСК MOESK 75 МОЭСК MOESK 110,6 IDGC of Centre МРСК Центра IDGC of Центра МРСК Centre 60,4 36 #2 #2 IDGCМРСК ЦентраVolga Region of Centre and и Приволжья 19 IDGC of Centre and и Приволжья МРСК Центра Volga Region 54,4 ЛенЭнерго Lenergo 17 IDGC ofУрала МРСК Urals 49,8 IDGC of Урала МРСК Urals 17 IDGC of Сибири МРСК Siberia 43,4 IDGC ofСибири МРСК Siberia 15 МРСК Волги IDGC of Volga 39,4 IDGC of Волги МРСК Volga 15 Lenergo ЛенЭнерго 34,2 МРСК Северо-Запада IDGC of North-West 11 МРСК Северо-Запада IDGC of North-West 26,7 Company IDGC of South МРСК Юга 5 МРСК Юга IDGC of South 22,0 obtains leading IDGC of North Caucasus МРСК Северного Кавказа 3 IDGC of North Caucasus МРСК Северного Кавказа 10,5 positions among IDGCs Net profit, RUR billion RAB, RUR billion MOESK МОЭСК 15,6 MOESK МОЭСК 205,3 IDGC of Центра МРСК Centre МРСК Центра IDGC of Centre 4,7 #2 118,2 #2 Lenergo ЛенЭнерго 3,8 IDGC of Centre and и Приволжья МРСК Центра Volga Region 84,8 IDGC of Урала МРСК Urals 1,7 ЛенЭнерго 78,6 Lenergo IDGCМРСК Центра Volga Region of Centre and и Приволжья 1,4 МРСК Волги 77,0 IDGC of Volga IDGC of North Caucasus МРСК Северного Кавказа 0,6 IDGC of Урала МРСК Urals 57,2 IDGC of Volga МРСК Волги 0,3 IDGC of Сибири МРСК Siberia 51,6 МРСКof North-West IDGC Северо-Запада -0,8 IDGC of North-West МРСК Северо-Запада 22,9 МРСК Сибири IDGC of Siberia -2,8 МРСК Юга IDGC of South 22,5 26 IDGC ofМРСК Юга South -3,6 2 позиция IDGC of North Caucasus МРСК Северного Кавказа 18,0 2 позиция